Renting vs. Buying Property in Singapore: What Makes More Sense for Expats

Singapore is a global hub for expats for a multitude of reasons, with world-class infrastructure and a high standard of living being some of them. When relocating, you ought to consider your living situation, i.e., whether you should rent or buy an apartment in Singapore. Here, we break down what renting vs buying looks like for expats in Singapore.

Renting in Singapore for Expats

For most newcomers, renting is the most practical way to get settled. When you rent an apartment in Singapore, you’ll find everything from modern condos to HDB flats (public housing), though foreigners are typically only eligible to rent HDBs and not purchase them.

Process to Rent Property in Singapore

A typical rental process in Singapore looks like this:

1. Engage a licensed property agent. They’ll help you navigate the market and shortlist options that fit your needs.
2. Take a look at different apartments or condos before making a decision.
3. Typically, you’ll need your passport, visa or employment pass, and proof of income or employment.
4. Draft a Letter of Intent (LOI) with your agent’s guidance. You’ll submit this to the landlord outlining your offer, lease term, and any special conditions.
5. Once the landlord accepts, you’ll move forward with signing the tenancy agreement.
6. Carry out an inspection. Check for any damages, appliance issues, or maintenance needs.
7. Collect your keys and move in.

Average Cost to Rent Apartment in Singapore

Here’s the average per-month rent you can expect:

Things to Consider When Renting in Singapore

Before you rent an apartment in Singapore, here are a few key things to keep in mind:

• Budget Beyond the Rent: Apart from monthly rent, you’ll likely need to pay a security deposit (usually one to two months’ rent, depending on lease length) and agent’s commission if you use one. Utilities, internet, and maintenance are also separate.
• Furnishing Levels: Apartments are rented out in different states: fully furnished, partially furnished, or unfurnished. Always check what’s included so you don’t end up with unexpected shopping costs.
• Neighbourhood Costs: Rental prices vary widely across districts. Living close to the CBD or Orchard Road will cost more than in suburban or fringe areas.
• Check Insurance: Many landlords in Singapore hold home content insurance, which usually protects their appliances, furniture, and fixtures, not your belongings. If you’re moving into an unfurnished unit or bringing valuable items with you, it’s worth arranging your own home insurance to safeguard your possessions.

Can Foreign Nationals Buy Property in Singapore?

Foreigners can buy property in Singapore, but with restrictions. The Residential Property Act sets clear rules for property purchase. Here’s a quick breakdown:

Properties That Require Government Approval

Foreigners must apply for approval before purchasing these types of properties:

• Vacant residential land
• Terrace houses
• Semi-detached houses
• Bungalows or detached houses
• Strata landed homes outside an approved condominium (e.g., townhouses, cluster houses)
• Landed properties at Sentosa Cove
• Shophouses used for residential (non-commercial) purposes
• Association premises
• Places of worship
• Worker’s dormitories or serviced apartments
• Mixed commercial & residential properties (special rules apply)

Properties You Can Buy Without Approval

The following are generally open to foreign buyers:

• Condominium unit
• Flats or apartment units
• Strata landed houses within an approved condominium development
• Leasehold landed property (if the lease term is 7 years or less, including renewals
• Shophouses used for commercial purposes
• Industrial or commercial properties
• Hotels registered under the Hotels Act
• Executive condominium (EC) units, HDB flats, and HDB shophouses (with restrictions depending on eligibility and minimum occupancy rules)

Criteria for Approval

To buy restricted property in Singapore (like landed homes), you’ll need approval from the authorities. Applications are reviewed individually, but generally, you’ll need to show:

• Permanent Residency: You should have been a Singapore Permanent Resident (PR) for at least five years.
• Economic Contribution: You must demonstrate a strong financial contribution to Singapore, usually assessed by your employment income and taxes paid locally.

Note that approval isn’t guaranteed, as each case is evaluated on its own merits, but meeting these two conditions significantly improves your chances.

Procedures for Buying Property in Singapore

Here’s how the process typically works:

1. Check Your Budget: Use affordability calculators or get pre-qualified with a bank to know how much you can borrow.
2. Understand the Taxes: All buyers pay Buyer’s Stamp Duty (BSD). Foreigners also pay the Additional Buyer’s Stamp Duty (ABSD). Ensure you also factor in legal and admin fees.
3. Search for Properties: Look at HDB flats, executive condos, or private condos. Consider location, MRT access, amenities, and commute times.
4. Secure Financing: Foreigners can only take bank loans (up to 75% of the property price). Keep savings aside to cover at least 12 months of payments.

Average Apartment Cost in Singapore

• Price per Square Meter to Buy an Apartment in the City Centre: S$29,000
• Price per Square Meter to Buy Apartment Outside of Centre: S$20,150

Things to Consider When Buying

Before you decide to buy property in Singapore, keep these points in mind:

• High Upfront Costs: Besides the property price, you’ll need to cover stamp duties (BSD + ABSD), legal fees, and agent’s commission.
• Strict Eligibility: Foreigners can only buy certain property types freely (like condos) and need approval for landed homes.
• Financing Limits: Bank loans usually cover up to 75% of the property value, so you’ll need significant cash upfront.
• Long-Term Commitment: Buying makes sense if you plan to stay for many years; otherwise, renting may be more flexible.

Is It Better to Rent Apartment or Buy House? The Verdict

For most expats in Singapore, renting an apartment makes more sense. It’s flexible, requires less upfront cost, and suits those who aren’t sure how long they’ll stay. The rental market is well-established, with plenty of choices across different budgets and neighbourhoods.

On the other hand, buying property is best suited to expats with long-term plans in Singapore, strong financial stability, and Permanent Residency. Looking for a flexible and stylish rental? Find your next home in Singapore with Weave Living.

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